Most people would have investment with the Mutual Funds and the returns from it would be shattered to very lower levels as of now. Most people would have the tendency to redeem the funds and invest it some where else. Ha.. I read your mind The rate of return for other funds would be attractive but you should have to be careful and thoughtful by thinking out the negatives and positives while you plan for the redemption of your Mutual funds.

The first important thing that you should understand is that mutual funds are not stocks. The decline in the prices of stocks does not necessarily mean that its time for selling the fund. Stock are really single entities that work with the pressure that the markets give and they are working on the principle of buying low and selling high, this cause panics among the traders when the markets fall and they sell off all their stock of stocks. Mutual Funds are a collection of stocks and bonds which are purchased by fund managers in accordance with the funds scheme. This brings in diversification of assets, this also differ from funds to funds. Diversification is more applicable to balanced funds than sector funds.  

You have an aim when you made your money to be invested in a mutual fund, that is for the maximum growth of your money. Your fund may be a long term asset and may fetch you good returns, but that is not a criteria that you should hold your fund through every testing periods, or for the love you have for your fund manager or for a specific sector, Its purely a business relationship and profit is the main goal of an investor like you and me, Personal relations does not come in business. Mutual Funds can lead you to success when you know to hold them and when you know how to get them folded. 

As in the life of an Mutual fund investor you will have to face some situations where you have to be careful. If you have your fund manager changed can sometimes effect you, most people do trust something before they invest, it may be the company, the fund manager, the fund itself. The right strategy that can be adopted is that you have to trust the fund house rather than the fund manager. If there happens to be a change with your fund manager you can wait for an year and see the performance of the fund. If its an equity based fund a minimum period of three years should be taken into consideration. If you ought to take a decision in a hurry then it may cost you money with the exit load if applicable and with the returns.  

You might want to get a portfolio revamp so you would need to sell it, then you can have a good analysis of the situation and do it. If you are looking for a tax break to offset realised capital gains of your other investments you would be looking to redeem your funds, to apply the loss to your capital gains. When planning for a sell make sure that you have taken due consideration of the pros and cons that it might bring. If after taking into consideration you make it to sell then do not have a second thought sell it off and be careful to know if there is an exit load. 

How is your fund with you are you planning for a cash in…? 

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